In a significant ruling, the Telangana High Court has stepped in to provide justice to thousands of investors allegedly defrauded by a Hyderabad-based firm. The court has ordered measures to compensate over 4,000 victims across Telangana and Andhra Pradesh who were duped by the Dhanwantari Foundation International (DFI).
Court Directs Auction of Attached Properties
The High Court, hearing appeals filed by DFI, upheld the earlier attachment of the company's assets and directed authorities to move forward with their auction. Justice K Sujana ordered the formation of a dedicated four-member committee to oversee the process. This committee will include a former district judge and a senior chartered accountant to ensure transparency.
The core directive is to identify all victims, auction the firm's attached properties, and proportionately disburse the proceeds based on each investor's stake. The properties in question are spread across eight prime locations in the two Telugu states and are currently estimated to be worth over ₹500 crore.
The Modus Operandi of the Alleged Fraud
According to the case details presented in court, Dhanwantari Foundation International collected substantial investments primarily from members of the Brahmin community. The firm lured investors by promising high returns on their deposits.
Initially, DFI made some payments to maintain credibility, but allegedly stopped all payments after amassing a significant corpus from the public. Based on numerous complaints from victims, the Central Crime Station (CCS) of Hyderabad police registered an FIR in 2023 and later filed a chargesheet.
Following the investigation, a special court in Nampally ordered the attachment of the firm's properties in August 2025. DFI challenged this attachment order in the High Court, calling it illegal and arbitrary, and a violation of natural justice principles.
Prosecution Reveals Scale of Financial Diversion
Opposing DFI's appeals, Public Prosecutor Palle Nageshwar Rao presented stark figures to the court. He stated that investigations revealed the firm had collected approximately ₹762 crore from investors. However, DFI's own admission only accounted for ₹516 crore, indicating a massive diversion of funds aimed at misleading both investigators and victims.
The prosecutor also informed the court that authorities have frozen 50 bank accounts linked to DFI, its group entities, and the personal accounts of its directors and partners. The aggregate balance in these frozen accounts is ₹27.45 lakh.
Arguing for the dismissal of the appeals, Rao emphasized the need to protect innocent victims who had lost their life savings in the scheme.
Justice Prevails for the Victims
After considering arguments from both sides, Justice Sujana ruled in favour of the victims. The court's order paves the way for a structured process to liquidate DFI's assets and return the money to those who were deceived.
This ruling marks a crucial step towards financial justice for the thousands affected and sets a precedent for handling similar investment fraud cases in the region. The court's decision to appoint an independent committee underscores its commitment to ensuring a fair and equitable distribution of the recovered funds.
